Linden Lab, VAT, data protection and all that

I note, via Milton Broome's blog, that the University of Edinburgh have made available a draft set of guidelines for making use of external Web 2.0 applications (direct link to the PDF) within university teaching and research activities.

This document offers guidance to staff within the University on some of the issues which need to be considered before using such services for University purposes. The document is intended to be helpful for all staff, including researchers, teaching staff and support staff.

This document is not specific to use of Second Life but most of the issues are pertinent to its use in education.

One is kinda left wishing that things didn't have to get so legal sounding - but I suppose that they probably do. Whatever... this looks like a very useful document and one that I'm guessing will begin to be mirrored in other institutions.

There's a big section on the issues around data protection. Given that Linden Lab are now collecting UK VAT from us it would seem logical that they also have to comply with UK and/or European data protection legislation. Is that the case?